Lawn Care multi-year proforma: Exercise 1 - Use the given first year (year 1) Financial Statements in the attached worksheets and the assumptions below to build continued financial statements for years 2, 3 and 4 Year 1: Assume the ORIGINAL BASE CASE results of Lawn Care's Income Statement, Balance Sheet and Statement of Cash Flows are for year 1. Starting with the year 2 column, build Lawn Care's continued Financial statements using the assumptions below. Year 2: Assume Revenue and expenses stay the same as year 1. Assume DSO grows from 30 days to 60 days Assume total wages payable (lawn mowers+ overhead) grow from O days to 60 days Year 3: Assume prices charged to all customers grow by 5%, but both number of customers and mix of small, medium and large lawns stay the same. Since no customers are added, you don't need to purchase more gas, hire more labor, or buy more equipment. these all stay the same. Assume marketing, G&A and supply costs stay the same as well Assume DSO and wages payable both remain at 60 days Year 4: Revenue, Expenses, DSO and Wages Payable from year 3 stay the same in year 4. Assume you buy one more lawn mower for $500 at the beginning of the year having a 5-year life. Assume you finance the lawn mower purchase by taking out a 3-year $500 bank loan at 10% interest. wn Care Summary Income Statements (Detail for Year 1) 3 Original Revenue: $38,400.00 15 lawns @ $20/cut 48 cuts/y 10 lawns @ $30/cut 48 cuts/yr Slawns @ $40/cut * 48 cuts/ys $14.400.00 $14,400.00 $9,600.00 Cost of Goods sold: (523,040.00) Labor e $10/hr. 1,920 hrs Gas @ $2/gallon 1,920 gallons IS19,200.00 ($3,84000) Gross Margin: $15.360.00 General and Administrative Expenses: 154,300.00 Marketing @ $20/hr + 50 hrs Administration $20/hr 150 hts Supplies and Maintenance EBITDA (earnings before Interest, taxes and depreciation): (51,000.00) ($3,000.00 (5300,00) $11,060.00 Total Annual Depreciation: ($175.00) Mowers @ 5500/5yrs Shed $1.500/0yrs $100.00) 1575.00 Interest expense SO DO Earnings Before Taxes $10 RS.DO Taxes (rate 0.25) 152.720253 Net Income Aner Tas S16375 Lawn Care multi-year proforma: Exercise 1 - Use the given first year (year 1) Financial Statements in the attached worksheets and the assumptions below to build continued financial statements for years 2, 3 and 4 Year 1: Assume the ORIGINAL BASE CASE results of Lawn Care's Income Statement, Balance Sheet and Statement of Cash Flows are for year 1. Starting with the year 2 column, build Lawn Care's continued Financial statements using the assumptions below. Year 2: Assume Revenue and expenses stay the same as year 1. Assume DSO grows from 30 days to 60 days Assume total wages payable (lawn mowers+ overhead) grow from O days to 60 days Year 3: Assume prices charged to all customers grow by 5%, but both number of customers and mix of small, medium and large lawns stay the same. Since no customers are added, you don't need to purchase more gas, hire more labor, or buy more equipment. these all stay the same. Assume marketing, G&A and supply costs stay the same as well Assume DSO and wages payable both remain at 60 days Year 4: Revenue, Expenses, DSO and Wages Payable from year 3 stay the same in year 4. Assume you buy one more lawn mower for $500 at the beginning of the year having a 5-year life. Assume you finance the lawn mower purchase by taking out a 3-year $500 bank loan at 10% interest. wn Care Summary Income Statements (Detail for Year 1) 3 Original Revenue: $38,400.00 15 lawns @ $20/cut 48 cuts/y 10 lawns @ $30/cut 48 cuts/yr Slawns @ $40/cut * 48 cuts/ys $14.400.00 $14,400.00 $9,600.00 Cost of Goods sold: (523,040.00) Labor e $10/hr. 1,920 hrs Gas @ $2/gallon 1,920 gallons IS19,200.00 ($3,84000) Gross Margin: $15.360.00 General and Administrative Expenses: 154,300.00 Marketing @ $20/hr + 50 hrs Administration $20/hr 150 hts Supplies and Maintenance EBITDA (earnings before Interest, taxes and depreciation): (51,000.00) ($3,000.00 (5300,00) $11,060.00 Total Annual Depreciation: ($175.00) Mowers @ 5500/5yrs Shed $1.500/0yrs $100.00) 1575.00 Interest expense SO DO Earnings Before Taxes $10 RS.DO Taxes (rate 0.25) 152.720253 Net Income Aner Tas S16375